As usual, we have been scouring the internet looking for interesting pieces to share with you all and one that just caught our eye was a story posted on Inman.com which detailed the 10 reasons why for-sale-by-owners (FSBO) fail.
While trying to save money by selling your own home – without a professional – might seem the way to go, the reality is there are many speed bumps to navigate along the way that could derail a sale.
According to Inman.com, here are the top reasons why FSBOs fail:
- Too many people to negotiate with
First, you have the buyer, seeking the best possible deal, then the buyer’s agent, who represents the buyer’s best interest. Then, there are home inspection companies and an appraiser. There are just a lot of hands in the proverbial cookie jar.
- Homeowners do not know how to prepare the home for sale
Simply stated, a majority of homeowners don’t know about the prelisting tasks they should do before listing their home for sale.
- Owners do not know how to screen potential buyers
Not knowing if a buyer has the ability to purchase the home acts as a big deterrent for homes for sale by owners.
- Owners fail to solve buyer’s queries
Many owners either aren’t able to handle inquiries on their homes or don’t have the time for them.
- Owners don’t understand the concept of “golden time”
If a seller tries FSBO before hiring an agent, the seller loses the “golden time” window. Buyers are eliminated who have already viewed the home and might have made a reasonable offer – but have already moved on.
- Owners fail to understand the contract procedures
Pretty self-explanatory here. Real estate contracts have lots of timelines and clauses and involve several common contract contingencies, such as inspections and mortgages.
- FSBOs don’t know how to handle the home inspection findings
Many FSBOs believe that there is nothing wrong with their home. As a result, an offer might fall through.
- FSBOs incorrectly price their homes
Lack of experience is a big factor with this. Prices are typically set too high.
- FSBO homes lack exposure
Many websites just don’t allow FSBOs to list their property.
- FSBOs fail in the closing process
Even after an offer is accepted, many things still need to be done prior to the closing. One must cross their T’s and dot their I’s.
So, there you have it. Our word of advice – think long and hard if you are going to attempt to sell a home on your own. Clearly, it’s a lot harder than it appears.